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Washington Week: Congress nears finish line on taxes, short-term spending

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Washington Week: Congress nears finish line on taxes, short-term spending

With a week to go until Christmas, Congress is rushing to get over the finish line a tax bill that will preserve key credits and deductions for the power sector and pass another short-term spending measure for the federal government.

A congressional conference committee released a final tax reform report Dec. 15 that spared the renewable industry from proposals that would have weakened federal tax credits for wind and solar energy. The report kept a Senate proposal for a new tax on cross-border payments by multinational companies that could make financing renewable projects more difficult but softened the provision to make it more favorable to the industry.

The report also kept key business deductions favored by investor-owned utilities and eliminated the corporate alternative minimum tax, which renewable energy and coal producers feared would prevent them from utilizing certain business deductions if maintained.

The tax package will need approval from the House and Senate before moving to President Donald Trump's desk for signing, something Republicans hope to achieve before the Christmas holiday. Democrats mostly have panned the GOP's tax proposals as a giveaway to corporations and the wealthy and complained that Republicans are not being transparent on the process. But the legislation is moving under the reconciliation process, which allows the Senate to pass the plan with approval from just a simple majority without being subject to a filibuster.

However, the timing of the votes is unclear, with Senate Republicans John McCain and Thad Cochran both dealing with health issues that could create scheduling conflicts. Questions also remain as to whether the Senate Finance Committee will roll out a separate tax extenders package before the end of 2017 that could include credit extensions for carbon capture and sequestration and other energy technologies that were not included in the broader tax package.

Spending bills

Congress this week also is expected to vote on another short-term continuing resolution, this time to fund the government until Jan. 19, 2018. Current funding expires Dec. 22 under a resolution passed earlier this month.

The stop-gap funding legislation excluded controversial policy measures for energy, but a bigger fight looms if and when Congress considers regular appropriations bills for the rest of the 2018 fiscal year.

In 2017, the Republican majority attached policy riders in proposed fiscal year 2018 spending bills that could affect energy producers. Those riders included a proposal from the House that would allow the U.S. Environmental Protection Agency and Army Corps of Engineers to speed their planned repeal of the Clean Water Rule by avoiding typical public comment processes. House Republicans also attached riders to spending legislation that would block the EPA from implementing rules to limit venting, flaring and leaks from the oil and gas sector and control methane from those operations.

Congress has yet to agree to a top-line spending level for the 2018 fiscal year, preventing lawmakers from passing regular appropriations bills, but those proposals and related policy riders could be back in play in 2018.

Senate confirms more EPA officials

In its final weeks of 2017, the Senate confirmed more Trump administration nominees for the EPA, rounding out the top ranks at the agency as it prepares to tackle a busy slate of air and water issues in the new year.

The Senate voted Dec. 14 to confirm David Ross as assistant administrator for the EPA's Office of Water. Ross will hold that position as the EPA works to repeal the Obama administration's Clean Water Rule, which defines waters subject to federal regulation, and propose a successor rule sometime in 2018.

On Dec. 14, the Senate also confirmed Matt Leopold's nomination as the EPA's general counsel, a week after approving Susan Bodine as assistant administrator for the agency's Office of Enforcement and Compliance Assurance.

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Industry events

Dec. 18

The Center for Strategic and International Studies' Energy and National Security program will host Peter Fraser, head of gas, coal and power markets at the International Energy Agency, for the launch of the IEA's 2017 coal analysis.

Dec. 19 The Energy Bar Association will host a panel discussion on the proposed repeal of the U.S. Environmental Protection Agency's Clean Power Plan and possible replacement options at Sidley Austin LLP's office in Washington, D.C.

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NERC urges FERC to recognize resilience attributes of coal, nuclear generators

EPA adopts DTE Energy argument on NSR as Supreme Court declines further review

Interior to propose new rules on environmental reviews, endangered species

EPA will soon seek information on Clean Power Plan replacement